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Estimating the welfare cost of taxation in a labour market with Unemployment and non-participation
Author(s)
Date Issued
1999-02
Date Available
2009-02-27T17:13:42Z
Abstract
The standard public finance analysis of the welfare cost of labour income taxation is based on the estimation of labour supply functions that treat unemployed individuals as non-participants. This paper applies
econometric models of multinomial discrete choice to the labour market, explicitly allowing individuals to be in any of three possible states (employment, unemployment and non-participation). Based on these estimates, we present calculations of the dead-weight loss of taxes, which turn out to be much larger than those suggested by the standard literature.
Type of Material
Working Paper
Publisher
University College Dublin. School of Economics
Series
UCD Centre for Economic Research Working Paper Series
WP99/2
Copyright (Published Version)
UCD School of Economics 1999
Subject – LCSH
Labor market--Econometric models
Taxation
Unemployment
Language
English
Status of Item
Not peer reviewed
This item is made available under a Creative Commons License
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